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Shops and Establishment

Do You Need To Get Any License To Start A Retail Shop?

A retail store can be a specialty store, a department store, a supermarket, a convenience store, a drug store, or a discount store. Retail shops, supermarkets, e-commerce platforms, etc., have increased as business opportunities in the retail sector have grown. Today, retail accounts for 10% of India's GDP. Due to its enormous importance, retail trading is subject to regulation, including shop registration and trade licenses.

A retail shop is a subcategory of the retail sector that sells goods directly to consumers. As a bridge between manufacturers and consumers, retail trading is typically carried out in shops where the retailer or shop owner sells the goods directly to the consumer. Retail shops are selling goods online through e-commerce platforms, phones, vending machines, etc. The end goal is to get the goods into the hands of consumers. 

Types of Goods Sold in Retail Shops

To cater to the needs of the consumers, shop owners need to be aware of some specific types of goods they can display in their store, encouraging the customer to buy them. 

Some of the different types of goods available are: 

  1. Convenience Goods 
  2. Shopping goods 
  3. Speciality Goods 
  4. Unsought goods 
  5. Impulse goods 

Convenience Goods

These are goods that are readily available for the consumption of the consumer. They are the most demanded and common products out there. Further, they include products used for daily use and immediate consumption, such as milk, vegetables, fruits, etc., which are considered essential for daily life and routine. They are inexpensive. 

Shopping Goods

These include goods that require research, comparison and planning. Unlike convenience goods, these goods cannot be bought immediately. They are bought to use over a long period to fulfil tasks in the long run. Such goods include clothing, electronics, furniture, etc. 

Speciality Goods

Such goods will normally be reserved for an upper class of people who have the financial means to purchase such a product. This includes rare, unique products and is not easily available to everyone. The marketing of such goods is also so that it only targets that part of the consumer group that can provide such products. The ideal example of such goods is jewellery, luxurious cars, watches, accessories, etc.

Unsought Consumer Goods

These are such goods which are readily available but not purchased regularly. They only fulfil a particular requirement and are only bought by consumers when the need for such a product arises. Examples of which are hardware store goods, electrical components goods, etc. 

Trade License & Shop and Establishment Registration

About Trade License

trade license permits permission to carry any trade or business in a particular area. The municipal corporation of that area will issue this license. The procedure of obtaining such a license varies from state to state. This is mandatory for any trade or business because it aims to keep the interests of the consumers so that they will not be affected by any health hazard or nuisance. Carrying on a trade or business without such a license is illegal. 

Trade licenses are for registering people working in various industries such as shops and food establishments. It is for adults above the age of 18 who have no criminal record and have a legitimate business. A procedure has to be followed for the application for the trade license, such as providing identity documents, address proof, lease documents for the property, NOC Certificates, property tax receipt, etc. 

After a trade license is procured it cannot be used for any other business except the one it is issued for. It acts as a reassurance to consumers that they are not becoming victims of unethical practices. It acts as a watchdog and regulates every trade or business with guidelines, rules, and measures. A trade license is vital for business when starting a retail shop as it legitimizes your business in the eyes of the government and the consumers. It also develops a three-way relationship of trust. 

About Shop & Establishment Registration

The Shop and Establishment Act regulates all commercial and retail establishments such as shops, malls, mega marts, wholesale shops, hotels, eateries, amusement parks, theatres, other entertainment houses, etc. It is related to wages payment, working hours’ regulations, leaves, holidays, terms of services, and other conditions.

GET YOUR SHOPS & ESTABLISHMENTS LICENSE TODAY!

The Shop and Establishment is a license or basic proof of your establishment or shop. Every state has a different process and procedure for registration, but it is mostly similar. The business owner has to apply for the registration and license within 30 days of commencing business. This license enforces proper regulation of workers’ rights and work conditions. 

The Shop and Establishment license and registration are from the Department of Labor. To apply for the license, the business owner has to file several documents such as the name and the address of the establishment, details of the owner and the employees at the time of incorporation, a copy of the sale deed or rental agreement of the property where the establishment has been set up and the PAN card of the business owner. 

The Trade License and the Shop and Establishment license are crucial for starting a business as they are your business’s identity and a regulatory body. Additionally, it is mandatory to have both documents to run a business in any state of India. 

Product Specific License

Sometimes businesses can be specific to buying and selling only specific products. Moreover, it is mandatory that some products have to be sold only by the person holding the specific product license, for example, for Food, Drugs, and Cosmetics. 

FSSAI Food license

An FSSAI License or Food License is a certificate of registration that permits you to sell food products. A 14-digit number is on all food packages on sale in the shop. This license will be granted to all manufacturers, traders, and restaurants which carry out food business in India. This license will be issued by the Foods Safety and Standards Authority of India. The mode of registration and procedure will be included in the Food Safety and Standards Act, 2006. Further, this act also contains other rules, guidelines, and regulatory standards. The license will be granted under Section 31 of the act above. 

Drugs and Cosmetic License

The licensing authority for the sale of drugs and cosmetics is the Drugs and Cosmetics Act, 1940. The act sets several regulatory standards for the manufacturing and selling of those drugs and cosmetics. Additionally, this is to keep consumers safe from harmful products. It also sets testing authorities and inspectors to check the drug and cosmetic sample before it is allowed to be on sale for public use. The process of obtaining such a license for selling drugs and cosmetics is under the Drugs and Cosmetics Rules, 1945. 

 Conclusion 

We hope the above information has cleared all your doubts. For further help or any guidance, reach out to our team. 

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